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  • #11677
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    #11674…. Please ignore. Looks like it is a general disclosure at BSE by all companies

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    Hi All, can someone explain why all the adtech stocks in US are hitting lows these days.. Are they any uncertainties / restrictions that are causing the downfall. Thanks.

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    Hope BCG comes out of ASM soon

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    @Raj, the real/true answer is those companies’ promoters are trying to snatch away shares.

    The answers that paid agents give are complicated and they are not true.

    Anyway, on a serious note, there are number of reasons/factors. First is the recent privacy setting changes that Apple introduced with the iOS 14 update. Even Facebook is/was worried about that. Since the Adtech industry is very big in the US and most of the people in the US use iPhones, I think investors are little worried as to how things will change. Then there is Google’s decision on third-party cookies, which actually paused the rally in adtech stocks. Then minor one is since the economy is opening up in the US, people will stream less (CTV) so CTV related companies will be impacted and with those companies even adtech companies may also suffer (just a guess). Then recently, all the growth stocks were battered, so adtech stocks were also impacted.

    I think the biggest one is the Google’s decision on cookies, since that announcement was made, all adtech stocks have fallen 30-50%. TTD (25-30%), Magnite (35-40%), PubMatic (40-45%), Perion (35-40%), Viant (35-40%), Marin Software (25-30%). Only Criteo is up in that period (10-15%) because it has already made changes to move away from cookies. Few years back, Criteo fell the most (close to 90%) because it relied too much on cookies and retargeting.

    This year’s results may not change that much but from next year there’ll be impact on revenues and profits. Don’t know how much it’ll impact BCG, only the CEO can answer this. My opinion is that companies that work closely with publishers will have the least impact and also direct advertising in apps will be beneficial.

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    Logan, many thanks for answering. There’s a quote “make hay while the sunshines”. I don’t whether this is applicable for bcg or not. But most of the companies have taken the advantage during the pandemic period. Everyday new technologies are emerging and there is cut throat competition in the market. Don’t know what our CEO has in his mind. Wishing him good luck in resolving the pending issues asap.

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    @Raj, BCG’s team is innovative but they’ve made mistakes too (if we consider valuation, the impact of those mistakes is very big but business wise not so much). The mistakes mostly have been made by the parent company (LGS merger which resulted in India debt and Lycos acquisition which resulted in DAUM case).

    When others didn’t see value in Lycos, they bought it for cheap and made good use of it and BCG was very early to implement programmatic advertising technology (or updating to newer trends). Others started it late or some didn’t start at all and that resulted in many companies losing business and getting acquired. When you start something late, you have to spend more money (you won’t have early mover advantage) and that’s why other companies, even if they had money, everything didn’t work out well for them and they got acquired for cheap valuations.

    BCG started “Brightcom” at the same time when DAUM case was going on. Had the company paid DAUM $34M ($54M total valuation) immediately (that the court ordered) then BCG couldn’t/wouldn’t have started Brightcom and that would’ve resulted in less revenues later. In 2010 Lycos was valued at $36M so in 2016-18 it would’ve been maybe half of that. So paying the rest $16M itself seems more but paying $34M more looks crazy to me. Everyone has different opinion on this but my opinion is that not paying more to get Lycos made sense.

    (Opportunity cost theory makes sense when there are opportunities but doesn’t make sense when everyone else has started something and you move in later. TTD has become the top dog in the Adtech industry because it was early in recognizing latest trends, TTD had already established a good system when others were trying to figure out. TTD took all the opportunities well and now is valued more than many other companies combined. When many companies were losing business, and market share, TTD was gaining both. BCG though didn’t become like TTD, at least it didn’t end up like RocketFuel or Millenial Media or Marin Software. If it had gone for Lycos first and decided to look at newer trends when everything had settled, then there’s no guarantee that it would’ve come out good.)

    The main reason I don’t believe in people’s theory that share prices were controlled by the CEO is because if he did control the prices then he’d have pumped it higher during 2013-19. That time many good futuristic companies were getting sold for peanuts. RocketFuel was sold for just $145M, Millenial Media was sold for $238M. So if the prices were in his control then he could’ve bought these companies and could’ve increased the revenues close to $1Billion by now. Now there’s more competition and the future looks uncertain (with Apple and Google’s privacy changes), so to snatch away shares at this time instead of snatching them away when he could’ve benefitted the most doesn’t make sense to me. Now RocketFuel type companies will be valued at $2Billion minimum. SpotX, a smaller company than RocketFuel sold for more than $1.4 Billion or something.

    Now we know why he wants that money from PW. Venturing into Audio advertising is a good move (but the size is not big enough) as it doesn’t depend on third party cookies. Like everyone, I’m also frustrated with the level of dilution done to get that money, but to say that it’s only to get more shares doesn’t look logical to me. Audio advertising is a growing market (especially since the pandemic started) and if he misses out now, then it’ll be very expensive later (maybe now itself it may have become expensive).

    Now value recognition is there but value realization has to happen and for that the price should go to at least 4-5PE. So the CEO’s concentration should be on that. Later on stable investors will start noticing the stock.

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    Spot on Logan. The elephant is still in the room. 😉.. Let’s assume, if bcg acquires Audio company like Spotify. Then, how do you see this situation in terms of the company’s valuation? This example is just only for better understanding. Rgds.

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    @Raj, I don’t think BCG has plans to acquire any streaming platforms, most of the companies are out of reach (Spotify alone is valued at $46Billion and there aren’t many public companies to get an idea on valuations) but it may acquire some company that provides tech to advertise on streaming platforms.

    According to the article on ET, the deal is very small ($15-20M) so I don’t think the impact will be big on both valuation and business. We should see how the market will react to the news. If the deal was of a bigger size, then the market would’ve cheered is my opinion.

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    Something is always good then nothing at all to start with. At least markets will now sense & Definitely give value according to the deal value of ( $15-20M ). Slow & Steady wins the race, Also the race will turn into a marathon with time. Upcoming Good qtly results will also give a zing & extra momentum. Logan sir, Thanks for the info. Cheers !!!

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    Just as BCG in the past bought small companies abroad and made it into big and profitable units they may replicate the same in the case of digital audio business as they may have done their homework and would have also weighed the pros and cons of acquiring the business from the past mistakes.

    With regards to upcoming changes in privacy policies of google, apple in 2022 most of the companies are not very perturbed due to it as they have their own strategies to overcome the situation, in fact due to the changes in rules of the game they may become stronger and bigger than before though as usual in businesses some players may fall by the wayside or get acquired by bigger players.

    BCG is a very old player in digital adtech space it has survived in much tougher times in fact it has been way ahead of times compared to many players even at global level so it will successfully find a way to navigate through the sudden changes in the rules of the game, by the recent trends seen in Adauth BCG’s business is growing more robustly in the recent times which clearly indicates that it may not be much affected by the changes in privacy or third party cookies policy, if the company gains more business from this churn it will be very good for the company and its future growth prospects.

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    As per the lastest information available in simply wall the public holding is only 25% now and this information is last updated on May 9th . Can someone cross check the public holding from some other source/website ?

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    Can you please let us know From where did you get this?
    1. In the latest Mar-2021 SHP, Goenkas/Priya Prakash/Uno/AKG holdings were not shown. I believe they were out in Nov/Dec-2020.
    2. Do insiders mean the promoter group?
    3. After PW/PO allotment, the promoter holdings should come below 25%. Can you please provide a detailed list of promoter holdings?
    4. On moneycontrol & BSE, the promoter holdings are shown as 36.76%
    5. Is SHP you shared realtime?

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    Hi buffet,

    As I had mentioned in my previous post #11690 this SHP information is available under which was updated on May 9th

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    This SHP appears erroneous. Still shows Oak India holding a large percentage. They have exited completely.

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    Number of publishers crossed 50k mark as per Adauth website. Hope this will have a meaningful & positive impact

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    Why The Trade Desk, Criteo, and Magnite All Fell Today

    TTD fell more than 25% yesterday in spite of posting great results. Market had expected even higher growth rates but was disappointed with just “great results” and beating analysts estimates wasn’t enough to stop the crash. Because of TTD’s news, even other ad-tech stocks fell. Magnite fell more than 20% Criteo fell 7%, Pubmatic fell more than 20%. This what happens when expectations are too high.

    The fall in prices of ad-tech stocks doesn’t concern BCG much because the stocks that fell the most were overvalued stocks. Some were trading at 40 times sales and over 100PE. Prices were not justifying fundamentals and the expectations were too high.

    But hey, only the CEO and paid agents can know about these things and simple Google search won’t give any results. Never trust people like me who talk sense but always trust people who compare with random IT companies, and with AFFLE. One person wrote that traders and momentum investors don’t follow fundamentals but why did TTD fall on results day? Why did other ad-tech stocks fall seeing TTD’s results? Traders won’t give a damn about fundamentals right? But why are they concerned about fundamentals of not just TTD’s but also other ad-tech companies? TTD’s results shouldn’t have affected other stocks, and why only ad-tech stocks fell so much? Technical of one stock might have been very good but did that stop that stock from falling?

    Talking sense means you are a paid agent or the CEO of BCG or a person having hidden motto. You are a genuine investor if trash talk about the CEO 24/7 or if you hype the stock/company when the price is going up and again trash talk if the stock price falls.

    I’m seeing people giving targets of x or y or z these days when the stock is in UC but the same people will say its a fake company if the price falls. This has been happening since many years. Then there are other people (mostly on different social media channels) who don’t know shit about shit but they talk as if they are the next Warren Buffett. They check BCG’s balance sheet, PL statement and they see the price and think that since the price is in penny levels, this must be a fake company. They never do qualitative analysis, they never bother to understand the business properly and they won’t even know the difference between profits and cash flows and they won’t know a damn thing about the importance of investing in intangible assets. They think that investing in intangibles is a crime and they don’t want companies to reinvest profits. These people are P/E, P/B ratio investors. If the company doesn’t pay dividends then these people think that profits are fake. The funny part is that these people have thousands or sometimes lakhs of followers.

    Company has changed name 3 times so it must be a fake company. Ybrant was changed to Lycos Internet because of the brand value that Lycos had. Many geniuses may not understand this because they know only about PE ratio or book value. The company can’t keep the name Lycos after losing Lycos, that’s common sense. These important information won’t be available in balance sheets, PL statements, or in charts or graphs.

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    Kuch Log jo zyada jante hai, Insaan ko kaam pechante hai. Logan sir, Don’t give heed to them. You continue with your analysis sharing.

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    Tomorrow someone will also say I am a Chamcha of your’s. Ignore. People opinion should not matter to us. Two hoots to all naysayers & fake analyst. Kis kis ka naam loo mein, Muje har kisine mara. Cheers!!!

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    @Logan & all fellow boarders

    Full transcripts of Magnite latest earnings Concall.

    Full transcripts of TTD (Trade Desk) latest earnings Concall.

    The Trade Desk, Inc (TTD) CEO Jeff Green on Q1 2021 Results – Earnings Call Transcript

    Full transcripts of Criteo ltd latest earnings Concall.

    Criteo S.A. (CRTO) CEO Megan Clarken on Q1 2021 Results – Earnings Call Transcript

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